Texas Instruments cutting jobs as profits plunge

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Texas Instruments posted a sharp drop in profit as it looks to cut 12 percent of its workforce.

TI's fourth-quarter profit fell 86 percent to $107 million, or 8 cents a share, from $756 million in the same period last year, or 54 cents a share. Excluding restructuring charges, TI had earnings of 21 cents a share, exceeding the 12 cents forecast by Wall Street analysts.

Revenue was $2.49 billion, down 30 percent, from $3.56 billion last year. The company also warned that revenue in the first quarter would drop further.

TI, which was ranked the No. 3 chipmaker worldwide in revenue by iSuppli in 2008, said it was cutting 12 percent of its workforce, which includes 1,800 layoffs and 1,600 voluntary departures.

"We are not counting on a near-term economic rebound for improvement," said Rich Templeton, TI chairman, president and chief executive officer, in a statement.

Charges for workforce reductions will be about $300 million, TI said. Annualized savings from these reductions, plus those announced in October for the restructuring of the company's Wireless business, will be about $700 million after all reductions are complete in the third quarter of 2009, the company said.

Other highlights:
    * Orders were $1.86 billion in the fourth quarter, down 47 percent from a year ago
    * Inventory was reduced by $200 million in the quarter
    * Capital expenditures were $76 million in the quarter, a decline from $181 million in 2007
    * For the first quarter of 2009 TI expects revenue of between $1.62 billion and $2.12 billion
    * For the first quarter of 2009 TI expects EPS of between $0.11 loss and $0.03 profit

Source :Cnet